On the path to patients, NASH drugs may hit a payer roadblock

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Liver doctors are noticing a change in their clinics. From Rochester, New York, to Plano, Texas, more patients are showing up with an illness they've never heard of before. "I hear the story over and over again: 'I didn't drink. Why would this happen to me?'" noted Brent Tetri, a hepatologist in St. Louis.

The patients have NASH, or nonalcoholic steatohepatitis, a liver disease caused by a build-up of fat rather than a virus or heavy drinking. Drugs for NASH aren't yet on the market, though the first ones could come in the next couple years.

Based on Wall Street estimates and clinical data released thus far, the earliest drugs are likely to come with limited efficacy and price tags of $10,000 or more. That's spurring apprehension among payers, leading healthcare providers to expect barriers to drug therapy for a majority of the estimated 10 million to 30 million NASH patients in the U.S.

"Payers are going to balk and try to be very selective in who we could prescribe to," Tetri told BioPharma Dive.

Only the sickest

Doctors, analysts and industry executives foresee the sickest patients — those with the greatest liver scarring — as the most likely to get coverage and reimbursement in the nascent NASH market.

Payers stand to save a lot of money through that strategy, as research has found just a small percentage of NASH patients ever develop advanced fibrosis.

A meta-analysis published in 2015, for example, looked at studies of adults who had either NASH or more general fatty liver disease. Among 411 patients, the analysis determined 15% were at the two highest stages of fibrosis, whereas nearly 70% were at the two lowest.

Data on the NASH population is far from conclusive, because the best way to define liver inflammation and scarring is through biopsy. The tests are invasive and relatively pricey, and there aren't enough hepatologists to perform them — a problematic combination for patients who want or could benefit from drug therapy.

"If insurance providers wanted to create a hurdle to access these drugs, they will [require] biopsy," said Manal Abdelmalek, a professor of medicine at Duke University.

Liver biopsy is just one hurdle payers can prop up. Another is that diet and exercise are actually quite good at slowing and sometimes reversing fibrosis. "If someone can lose 10% of their extra weight, then it makes a huge impact on the liver," said Kymberly Watt, a gastroenterologist at Mayo Clinic of Rochester.

The power of lifestyle changes gives payers another reason not to cover expensive NASH drugs, unless there's a high risk of the patient developing cirrhosis and needing a liver transplant. That's especially true if the drugs show questionable or mixed efficacy in clinical testing, as has been the case with all of the field's most advanced candidates.

"It would be very challenging to get a payer to cover a treatment when that treatment otherwise works as effectively as diet and exercise — or less effectively," Abdelmalek said. "That's a hard sell."

Most advanced NASH drugs haven't wowed on efficacy

Company

Drug name

Trial name(s)

Trial phase(s)

Hit primary endpoint(s)?

Intercept

obeticholic acid

REGENERATE

Phase 3

Yes

Gilead

selonsertib

STELLAR 3, STELLAR 4

Phase 3

No

Genfit

elafibranor

N/A

Phase 2

No

Allergan

cenicriviroc

CENTAUR

Phase 2

No

SOURCE: Companies, clinicaltrials.gov

Intercept Pharmaceuticals is the only drugmaker to have scored positive results in a late-stage NASH trial, and even that study found 75% of patients didn't experience significant fibrosis improvement without NASH worsening after 18 months of treatment with the company's medicine, obeticholic acid.

Obeticholic acid is actually on the market already, sold under the brand name Ocaliva for another liver disease called primary biliary cirrhosis. For that indication, Ocaliva's list price clocks in at nearly $70,000.

At least two investment banks expect Intercept to set the drug's price much lower in NASH — Steven Seedhouse of Raymond James models a gross list price of around $10,000, while analysts at Credit Suisse anticipate a higher $18,000 price tag. Still, such a cost may be unattractive to payers when lined up against diet and exercise.

Lifestyle changes, though, aren't always easy for people to maintain. Abdullah Mubarak, a gastroenterologist at the Liver Center of Texas, says one in 10 of his NASH patients is able to lose weight and keep it off for more than a year or two. That's pretty standard, according to other physicians who spoke with BioPharma Dive.

Where patients live and how much money they make also greatly affect the abundance of gyms or nutritious foods at their disposal. Payers aren't known for helping with those sorts of costs either.

"Access to a dietitian, to gym memberships, to personal trainers is severely limited by insurance," said Zachary Henry, a hepatologist with University of Virginia Health System. "So it may ultimately be cheaper for the patient to take a pill than to do those other things that are probably better for them in the long run."

Another hep C market?

All things considered, coverage and reimbursement decisions are likely going to boil down to price.

Even three years ago, the Institute for Clinical and Economic Review, a drug cost watchdog, sounded concerns about the potential impact to payer budgets if a drug like Ocaliva were to be approved in NASH. Taking the drug's list price of $69,350 per year and assuming uptake was "unmanaged," ICER forecasted a substantial budget impact if just 10% of diagnosed patients were to receive therapy.

ICER's analysis supports the idea that if a NASH drug is expensive, it would need to be highly potent with tolerable side effects to warrant the added costs.

Conversely, if a NASH drug is cheap, it could get payers' stamp of approval so long as it has a marginal health benefit. But even then, manufacturers may run into trouble alleviating price concerns.

Pasha Sarraf, an analyst at SVB Leerink, said payers fear the drug market for NASH will evolve in a similar manner to the one for hepatitis C.

There, physicians began holding off prescribing older, less effective therapies as they awaited an approval of Gilead's Sovaldi. The drug was essentially a cure, and that was reflected in its high price. Once it cleared regulators' desks in December 2012, the prescriptions came in droves — and payers' costs rapidly rose.

A couple years later, an emerging class of medicines aimed at the millions of patients with high cholesterol received a very different reception. The class, called PCSK9 inhibitors, has seen two treatments enter the U.S. market, yet both have been met with strong payer resistance because of their price tags.

"In the subsequent PCSK9 experience, they were ready, prepared and absolutely antagonistic towards the pharmaceutical companies in terms of bringing those drugs into the market for a broad population," Sarraf said.

Already, at least one large payer appears wary of NASH drugs.

"To date, reported clinical results have been either mixed, shown modest efficacy, or failed to meet trial endpoints. In addition, some compounds in development have demonstrated tolerability issues and other potentially treatment-limiting side effects," CVS Health said in an emailed statement to BioPharma Dive.

CVS Health did note that NASH drugs with favorable risk-benefit profiles "would be an important contribution to better patient care." However, the company said it was premature to comment on the potential impact of pricing due to the lack of FDA-approved therapies.

Pressure to keep list prices low will certainly loom as NASH drugs move toward market, both from payers and rival drugmakers. The dozens of candidates in mid- to late-stage testing suggests that competition would quickly ramp up after a handful of approvals.

"It won't stay expensive for very long, because there's so many competitors now that are basically at the same level playing field," said Watt of Mayo Clinic.